Rule 322 limits the deduction for an employer's initial contribution to a gratuity fund for the past services of an employee admitted to its benefits to 8% of the employee's salary for each year of past service.
322
Rules 2026 · Rule 322
Initial contributions (approved gratuity fund)
Rules 311-333
The rule. The amount allowed as a deduction on account of an initial contribution which an employer may make in respect of the past services of an employee admitted to the benefits of a fund shall not exceed 8% of the employee's salary for each year of past service with the employer.